Op-Ed: Managing the Uncertainty of Entrepreneurship

We spend our whole life trying to buy security from the unknown, to ensure known outcomes so that we are protected from the “unknowns”, such as a death, a car accident or a fire.

We get life insurance, health insurance, car insurance, disability insurance, homeowners insurance, personal property insurance, casualty insurance, state and federal unemployment insurance, income insurance via social security and retirement savings. The list goes on, and these are just basic types of insurance. While, businesses have their own class of insurances and derivatives to ensure earnings.

Because of our interest in known outcomes, we spend a large amount of our income insuring ourselves and our businesses to reduce and mitigate risk. I am fascinated by the cost to just live and breathe with basic insurance, even if it is a very simple life. But it can feel very reassuring to have insurance, even though we pay an arm and leg for it. For those that worry, it helps them worry less.

The Roller Coaster Ride of Unknown Outcomes

Now let’s examine entrepreneurship.

Entrepreneurial innovation is all about taking big risks. These big risks can have completely unknown outcomes, which is radically opposite of all of the insurance that we surround ourselves with. Moreover, being an entrepreneur can also mean lower quality insurance plans when you’re just getting started. So, with our enormous interest in insurance, it seems counterintuitive to be an entrepreneur; taking on so much risk while forging so much security.

But Ronald J. Baker, in his book “Pricing On Purpose,” sums it up well: “The history of business is the history of dreamers, and entrepreneurs, those rare individuals who cast aside the security of a paycheck, mortgage everything they have, and chase a dream that ends up creating our futures. The great economist Joseph Schumpeter referred to this process as the ‘perennial gale of creative destruction.’ The tempo of business is not one of stability, order, and a level playing field, but rather of disequilibrium and instability. Stability and equality only exist in the graveyards.”

The Reality: Entrepreneurship Isn’t for Everyone

Entrepreneurial innovation isn’t for everyone.

A startup is often a roller coaster ride with highs and lows and unexpected drops. It takes quite a bit of energy and enthusiasm to bear the unknowns, and quite a bit of commitment and dedication to forgo some of the assurances that come from working for someone else.

Trying to create something new takes guts. And it gets more difficult the longer you wait. A life that brings significant others, kids, cars, mortgage, savings and necessary retirement money can exponentially contribute to tying you to a known paycheck.

That’s why one of the most common attributes in successful entrepreneurs is enthusiasm for the unknowns. They often have a well of hope and energy that helps push the team forward and forgo things now in hope of better things to come.

The Comfort of Roller Coasters

If you do decide to take the entrepreneurial leap, take comfort in the fact that millions have come before you and gone for the ride. Every small to big business you see in your community started with some person in their garage, a spare bedroom, or a kitchen, following a vision.

A person who decided to step outside the comfort level of known outcomes and explore the unknown – trying to create something new that has value to others.

This article has been edited and condensed.

Jeff Dance is founder and CEO of Fresh Consulting, a student of all things creative and fresh, a professional snowboard instructor trainer, and the father of Brighton & Boston. A version of this post originally appeared on the Fresh Consulting blog. Connect with @jeffdance on Twitter.

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The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world's most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.